As the worst drought in 25 years continues to spread across the already scorched Midwest, Iowa Sen. Charles Grassley warns Newsmax.TV that Americans should brace for higher food prices and a “very bad 12 months.”

“You’re on the brink of an economy catastrophe similar to what we had in the 1930s if we don’t get some rain. And you won’t really know that until September,” predicted Grassley in an exclusive interview on Wednesday.

• The U.S. Food and Drug Administration employed “Stasi” tactics in spying on its own employees.
• Americans won’t know until after the election whether the Bush-era tax cuts will be extended.
• GOP presidential candidate Mitt Romney should face no higher burden to release tax returns than any other presidential candidate.

Watch the exclusive interview here.

Grassley, the ranking member of the Judiciary Committee who also serves on the Finance, Agriculture, and Budget Committees, said that it won’t be just farmers in the Hawkeye State who are hurt by the severe drought, but Iowa’s entire economy.

“I think that it’s going to, in a few months, raise the retail price of food, but in my state I believe that you’re going to have less livestock when you have less corn — or the livestock that’s maintained it will be a higher cost of finishing that livestock for slaughter — and it’s going to be a very bad 12 months,” he predicted.

U.S. Agriculture Secretary Tom Vilsack has already said the worsening Midwest drought will result in sharply higher crop prices though he refused to seek a reduction in corn-based ethanol production as hard-hit livestock producers called on the Obama administration to help ease corn prices by issuing an ethanol waiver.

“If we got rain this very minute — which we probably won’t — it would be less of a crisis, but it still is going to be at the best, very, very reduced production,” he explained. “It’s not quite as bad as Indiana or southern Illinois at this point, and maybe Missouri, but it is not good for our state, particularly right now when you are in what we call the pollination stage of the production of corn.”

While only 5 to 7 percent of Iowans directly work in the farming business, many small towns and corporations like John Deere are dependent upon a strong farm economy, which could put further pressure on the nation’s 8.2 percent unemployment rate and an already difficult job market.

“The workforce at about 63 percent of all the people having jobs is probably as low as it’s been in 40 or 50 years. And it’s going to be a long time to turn around,” said Grassley, who believes that the policies of the Obama administration have contributed to America’s economic woes.

“The policies of this administration are making it more difficult because small business particularly — but even corporations — are not going to hire when they see the biggest tax increase in the history of our country without a vote of Congress coming down the road at the end of this year,” he declared. “They see a $1.3 trillion deficit. They see exports not being promoted. They see the unemployment that’s out there and a lot of government regulation. They don’t know the cost yet of Obamacare.”

Those policies are disastrous for businesses. “All of this adds up to one word: uncertainty. Nobody is going to jump off the cliff when you’re talking about doing things for maybe a year ahead of time,” Grassley explained. “Business has to look ahead five or 10 years before they’re going to invest a lot of money — and particularly with a tax increase.”

He believes that a tax increase will take more capital out of the private sector at a time when businesses need it to create more jobs.

In yet another scandal facing the Obama administration, Grassley accused the Food and Drug Administration (FDA) of “Stasi” tactics in monitoring thousands of emails of its own scientists to track leaks of confidential agency information, based on a report in a recent New York Times report.

The probe initially focused on five scientists suspected of leaking information but then grew in response to a “collaboration” of the agency’s opponents, according to The Times. Grassley said the administration took seven months to respond to a letter from his office on the matter.

“You know what that really tells me is this agency sees itself separate from the rest of government. And particularly separate from the representatives of the people when they refer to people in Congress as enemies, when they refer to the press as enemies, when they refer to their own employees as collaborators, it reminds you of the East German Stasi police organization, spying,” charged the senator, noting that the FDA appears to have monitored email communications between alleged whistleblowers and their attorneys.

“We’ve got to stop it and it’s a violation of the lawyer-client relation because they fired three or maybe even five people that were considered whistleblowers,” he said. “They were getting the emails between the whistleblowers and their lawyers. It’s a violation of the whistleblower law because whistleblowers are supposed to be protected, and it violates the free speech of the whistleblowers because whether you’re a federal employee or not, you ought to have a right to talk to your congressman.”

With respect to the Bush-era tax cuts, which are due to expire at the end of this year, Grassley said Americans won’t know whether they will be extended until after the November election.

“We will steer away from the fiscal cliff, yes — whether or not we get the Bush tax bills extended, and maybe hopefully even made permanent law,” he said, acknowledging that a lot depends on whether Mitt Romney is elected president.

Weighing in on calls for Romney to release additional tax returns, Grassley insisted that the former Massachusetts governor should face no higher burden to do so than other presidential candidates.

“Mitt Romney shouldn’t have to do anything else as a presidential candidate than other presidential candidates haven’t done and I bet he’s already done that,” Grassley asserted.